Analyst Steven Milunovich said in a note to investors, a copy of which was provided to AppleInsider, that Cook "thinks big," and that bodes well for the future of Apple. He cited comments made by the CEO in the company's most recent earnings call, in which he said the company has "a very large vision of what iOS can be."

During the call, Cook said he envisions iOS finding success in the pocket, car, workplace, home and gym. And it's expected by many, including Milunovich, that iOS will soon come to the wearable device market in the form of an anticipated "iWatch."

"Cook has called Apple a mega-ecosystem that has grown 10x stronger in the last few years," Milunovich wrote. "We call it the Applesphere."

He's particularly excited by the upcoming addition of Continuity to iOS 8 and OS X Yosemite, which will allow users to seamlessly transition between their Mac, iPhone and iPad throughout the day. Add in CarPlay for vehicles, Apple TV in the living room, and iBeacon in stores, and Milunovich sees the "Applesphere" becoming ubiquitous.

In addition to the rumored "iWatch" tracking fitness and health, the analyst also believes that Apple will introduce mobile payments, allowing iOS to assist in yet another facet of users' daily lives. In this respect, he believes Apple's focus on customer satisfaction and loyalty will help ensure that users who try out the company's omnipresent ecosystem will stay hooked.

"The upside to the story from here may be less as a tech company and more as a luxury consumer franchise or lifestyle brand," Milunovich said.

Last month, UBS upped its price target for shares of AAPL to $115, predicting that gross margins will continue to improve for the company heading into 2015. On Wednesday, Milunovich stood by that target, and recommended that investors "hang in" for this fall, when the company is expected to enter into a new and lucrative product cycle.

Comments

Come on institutionals. Lay in already. Once you start driving the price up, that will substantiate and confirm all the good news on Apple. There are plenty on the fence that will lay into at after you do, so you'll still get a nice rake when you pull out.

Thinking big. That would be putting skylon to the sky, having your own satellite network, making electric cars Apple style and putting liquid metal into it all, and perhaps even going to Mars.Haven't seen that.

Thinking big. That would be putting skylon to the sky, having your own satellite network, making electric cars Apple style and putting liquid metal into it all, and perhaps even going to Mars.

Haven't seen that.

Yes, Google is shooting the moon 24/7! What does it have to show for it? A group of devoted fanbots praising the company in the comments section of the Verge! And nothing but revenues from the same PC web ads its been relying on since it was founded.

Apple is building an ecosystem and platform. Google is introducing exciting new strategies every year that are abandoned and replaced the next year. Google doesn't even have a copycat Android tablet platform, just a stretched smartphone platform that nobody uses for anything but watching pirated videos. What an amazing lost opportunity! Google should have tried to be Microsoft. Instead it is trying to be Linux.

For the kids who didn't observe the 90s, Microsoft made money, Linux gave an idealistic minority a cute logo to ineffectually rally behind.

Big things are coming from Apple very soon, and we've hardly seen any of it yet this year.

Once the new HQ building is completed, we'll see the truly "big things" as they descend from the sky, visiting ships from other worlds, docking at the Apple HQ, just as they docked on pyramids, in the classic "Stargate" movie.

Some people are finally understanding that Apple isn't "too big to grow". But a lot of people aren't ready to forget about the haircut they took when AAPL fell from $700/share to $400. I expect Apple's growth to continue to outpace its valuation, especially with stock buybacks significantly reducing the overall stock pool.

Case in point: Apple is currently showing an EPS of 6.19 and a P/EPS of 15.89. But if one calculates the net income over the last 12 months (38.6B) and divides it by the latest stock count (5.99B), one gets an EPS of 6.44 and a P/EPS at the present AAPL price of (98.22/6.44=) 15.25. That's a difference of (0.64/15.25=) 4.2%.

In other words, the market is undervaluing the EPS increase due to stock buybacks by over 4%. And Apple is far from done buying back its own stock, so one can expect this undervaluation to actually increase rather than decrease.

The result will be a marked drop in the average P/E ratio next year, even as the stock price climbs substantially higher. Yes, there will be times when the P/E will go higher, but that will be followed by a period of P/E compression as EPS leaps with each succeeding quarter.

Bottom line: A stock that should be trading at a P/E of 30 will see itself trading at an average P/E of half that or less.

This is not rocket science. Horace Deidu of Asymco has remarked on this phenomenon for years, where the market refuses to actually value Apple on its future potential, instead pulling out the old saw about "Law of Large Numbers" and others such malarky, and ending up only valuing Apple on what it actually does produce. But what it really masks is that the market just can't wrap its head around Apple, a company that, year after year, seemingly defies conventional thinking. And so the market is continually behind.

Even the great selloff of AAPL a couple of years back completely failed to notice that Apple continually matched its own forecast of future revenue growth. And that even when its revenue and earnings were reduced, its earnings were head and shoulders above the rest of the industry, with huge quantities of excess cash being generated. In fact, the market only "woke up" when Apple, akin to taking a 2x4 to the market's head, started using that huge pile of cash to buy back its own stock at fire sale prices.

AAPL is set for years of future appreciation, even as it approaches a new all-time high. But the market sees none of that, and won't see it, as usual, until after it happens....

The problem with Wall street they have no clue what apple is doing until after they have done it. This guy seem to have gotten new religion. Apple is still working on a roadmap which goes out another 10 yrs and show how iOS and OSX will meld together and works it way into may places. People will come to expect a seamless experience everywhere they go.

I have said it for years, you know technologies fails when you have to learn how to use it every time a new product or version comes out. Think about cell phone prior to the iphone how many time you had to learn how your cell phone worked as you change phones. Think about your TV remove, how everyone works differently and you need to learn how to set up your TV. or when you get into a different car you have to figure out how the radio works.

Even though iOS an OSX have evolved over the years it did not require you to relearn how to use your phone or computer upon a new update. Apple builds on what you already knows, This is what Android is a failure, and only people who can not afford to buy Apple choose to buy or get free and Android device.

Once the new HQ building is completed, we'll see the truly "big things" as they descend from the sky, visiting ships from other worlds, docking at the Apple HQ, just as they docked on pyramids, in the classic "Stargate" movie.

Yeah, the "Close Encounters" ships won't have to go to Wyoming anymore.

Yes, Google is shooting the moon 24/7! What does it have to show for it? A group of devoted fanbots praising the company in the comments section of the Verge! And nothing but revenues from the same PC web ads its been relying on since it was founded.

Apple is building an ecosystem and platform. Google is introducing exciting new strategies every year that are abandoned and replaced the next year. Google doesn't even have a copycat Android tablet platform, just a stretched smartphone platform that nobody uses for anything but watching pirated videos. What an amazing lost opportunity! Google should have tried to be Microsoft. Instead it is trying to be Linux.

For the kids who didn't observe the 90s, Microsoft made money, Linux gave an idealistic minority a cute logo to ineffectually rally behind.

The problem with Wall street they have no clue what apple is doing until after they have done it. This guy seem to have gotten new religion. Apple is still working on a roadmap which goes out another 10 yrs and show how iOS and OSX will meld together and works it way into may places. People will come to expect a seamless experience everywhere they go.

I have said it for years, you know technologies fails when you have to learn how to use it every time a new product or version comes out. Thing about prior to the iphone how many time you have to learn how your cell phone work as you change phones. Think about your TV remove, however everyone works differently and you need to learn how to set up your TV. or when you get into a different car you have to figure out how the radio works.

Even though iOS an OSX have evolved over the years it did not require you to relearn how to use your phone or computer upon a new update. Apple builds on what you already knows, This is what Android is a failure, and only people who can not afford to buy Apple choose to buy or get free and Android device.

Right. Talking about Remote...why the f all TV/DVD remotes have 200 buttons on them. I just fking hate those. I'm glad Apple simplify thing but doesn't sacrifice the use of it. LG starts following this concept of simplicity by creating the Magic remote even though it still needs improvement, but the concept is great.

Thinking big. That would be putting skylon to the sky, having your own satellite network, making electric cars Apple style and putting liquid metal into it all, and perhaps even going to Mars.

Haven't seen that.

I think we're going to have to wait for any random projects to get done when the new headquarters is finished. Apple has practically run out of space and I'm sure spreading employees all around different campuses is rather unwieldy. I like Apple to tackle some pie in the sky projects that have almost no ties to Apple's current business. Apple has all the cash in the world to go pursue purely humanitarian projects.

I think we're going to have to wait for any random projects to get done when the new headquarters is finished. Apple has practically run out of space and I'm sure spreading employees all around different campuses is rather unwieldy. I like Apple to tackle some pie in the sky projects that have almost no ties to Apple's current business. Apple has all the cash in the world to go pursue purely humanitarian projects.

ROFL

Yup its the silly season, you know we have places for people like you, the men in white coast are coming dude!